Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Stockholders' Equity

10. Stockholders’ Equity

Common stock

The Company’s Amended and Restated Certificate of Incorporation, authorized the Company to issue 100,000,000 shares of $0.001 par value common stock as of March 31, 2022.

Common stock warrants

As of March 31, 2022, the Company`s outstanding warrants to purchase shares of common stock, consisted of the following:

Issuance Date	Number of Shares of Common Stock Issuable	Exercise Price		Classification	Expiration Date
May 9, 2017	33,964	$	11.31	Equity	May 8, 2027
July 19, 2019	43,878	$	11.31	Equity	July 18, 2029
	77,842

Shares reserved for future issuance

The Company has shares of common stock reserved for future issuances as follows:

	March, 31	December, 31
	2022	2021
Warrants to purchase common stock	77,842	77,842
Common stock options issued and outstanding	2,179,647	2,175,685
Common stock available for future grants	1,924,967	1,934,095
Restricted stock units issued and outstanding	390,750	394,750
Common stock available for ESPP	401,164	401,164

2008 Stock Plan and 2021 Equity Incentive Plan, as amended (the 2021 and 2008 Plan)

A summary of stock option activity is set forth below (in thousands, except share and per share data):

	Number of Shares Underlying Outstanding Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding, January 1, 2022	2,175,685	$	9.27	8.68	$	2,856
Options granted	39,600	$	5.49
Options exercised	(5,166)	$	0.61
Options forfeited or cancelled	(30,472)	$	8.06
Outstanding, March 31, 2022	2,179,647	$	9.24	8.46	$	2,383
Shares exercisable March 31, 2022	1,542,586	$	9.30	8.17	$	1,830
Vested and expected to vest, March 31, 2022	2,179,647	$	9.24	8.46	$	2,383

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock options and the fair value of the Company’s common stock for stock options that were in-the-money as of March 31, 2022 and December 31, 2021.

The aggregate intrinsic value of stock options exercised during the years ended March 31, 2022 and March 31, 2021 was de minimis and zero, respectively.

The total fair value of options that vested during the three months ended March 31, 2022 and 2021 was $1.0 million and $0.1 million, respectively. The options granted during the three months ended March 31, 2022 and 2021 had a weighted-average per share grant-date fair value of $3.50 and $0.36 per share, respectively. As of March 31, 2022, the total unrecognized stock-based compensation expense related to unvested stock options was $7.9 million, which is expected to be recognized over the remaining weighted-average vesting period of 2.4 years.

Early exercise of stock options

The terms of the 2008 Plan permit the exercise of certain options granted under the 2008 Plan prior to vesting, subject to required approvals. The shares are subject to the Company’s lapsing repurchase right upon termination of employment at the original purchase price. The proceeds initially are recorded in accrued current liabilities from the early exercise of stock options and are reclassified to additional paid-in capital as the Company’s repurchase right lapses. During the three months ended March 31, 2022 and March 31, 2021, the Company had no repurchases of common stock. As of March 31, 2022 and December 31, 2021, there were 311,836 and 377,709 shares that were subject to repurchase, respectively. The aggregate exercise prices of early exercised shares as of March 31, 2022 and December 31, 2021 was $0.2 million, which were recorded in other current liabilities on the balance sheets.

Restricted Stock Units

In December 2021, the Company granted 394,750 restricted stock units under 2021 Plan. As of March 31, 2022, the total unrecognized stock-based compensation expense related to unvested restricted stock units was $1.4 million, which is expected to be recognized over the remaining weighted-average vesting period of 0.7 years.

2021 Employee Stock Purchase Plan, as amended (ESPP)

In October 2021, the Company adopted the 2021 Employee Stock Purchase Plan (ESPP), which became effective on the business day prior to the effectiveness of the registration statement relating to the IPO. A total of 401,164 shares of common stock were initially reserved for issuance under the ESPP. The offering period and purchase period will be determined by the board of directors. As of March 31, 2022, no offerings have been authorized.

Stock-based compensation associated with awards to employees and non-employees

Total stock-based compensation expense recognized was as follows (in thousands):

	Three Months Ended March 31,
	2022		2021
Cost of goods sold	$	69	$	15
Sales and marketing		591		63
Research and development		14		1
General and administrative		849		52
Total	$	1,523	$	131

The above stock-based compensation expense related to the following equity-based awards (in thousands):

	Three Months Ended March 31,
	2022		2021
Stock options	$	1,026	$	131
RSU		497		—
Total	$	1,523	$	131

The Company estimated the fair value of stock options using the Black-Scholes option-pricing model. The fair value of stock options is being amortized on a straight-line basis over the requisite service period of the awards. The fair value of stock options was estimated using the following weighted-average assumptions:

	Three Months Ended March 31,
	2022	2021
Expected volatility	70.8%		72.9% - 74.6%
Risk-free interest rate	1.9%		0.6% - 1.1%
Dividend yield	0%		0%
Expected term	6 years		5 - 6 years